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International Litigation and Financial FraudTue, 02 Dec 2014 16:17:17 +0000en-UShourly1https://wordpress.org/?v=4.7MichaelDiazJrhttps://feedburner.google.comSubscribe with My Yahoo!Subscribe with NewsGatorSubscribe with My AOLSubscribe with BloglinesSubscribe with NetvibesSubscribe with GoogleSubscribe with PageflakesSubscribe with PlusmoSubscribe with The Free DictionarySubscribe with Bitty BrowserSubscribe with Live.comSubscribe with Excite MIXSubscribe with WebwagSubscribe with Podcast ReadySubscribe with WikioSubscribe with Daily RotationDiaz Reus Forms Drone Legal Practicehttp://feedproxy.google.com/~r/MichaelDiazJr/~3/GPsOjENV6TQ/
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In response to the growing phenomenon of domestic drones and legal/regulatory issues surrounding their use, the Florida-based international law firm of Diaz Reus announces the launch of its Unmanned Aircraft Systems (UAS) practice. Headed by partner Brant Hadaway, whose aviation law background includes representation of American aircraft manufacturer Cessna, the new group will assist clients with navigating the regulatory and legal hurdles associated with this emerging technology.

“Apart from military use, drones, officially known as Unmanned Aircraft Systems, have only recently emerged as engines for domestic investment and economic growth,” said Hadaway, who writes about UAS law and regulation at DroneLaw.Com. “But the regulatory regime for commercial UAS operations has lagged behind the technology, creating a challenging and often confusing environment for businesses.”

While the FAA is expected to release a set of proposed rules specifically for small UAS (sUAS) by the end of December 2014, those rules will be subject to a lengthy comment period before they can become law. “Further, proposed rules for large UAS are still years away,” said Hadaway.

Reports suggest that the FAA’s proposed sUAS rules for commercial operators will include onerous licensing requirements on commercial operators who use small drones for tasks such as aerial real estate photography and surveying farm crops. Although the FAA does allow commercial operators to apply for exemptions, getting those applications reviewed and approved has proven time-consuming, and the expense creates high entry-barriers to individual operators. “Not even hobbyists are safe,” Hadaway noted. “That drone under the Christmas tree could, in theory, land you a substantial fine if you operate it in a manner that, in the opinion of the FAA, threatens life or property.”

Diaz Reus hopes to assist industry stakeholders with contributing possible solutions that would satisfy regulatory concerns while allowing greater room for innovation. “Exploring solutions is one of the reasons why I started writing DroneLaw.Com,” said Hadaway.

“In the meantime, the UAS industry will need legal guidance on how to target investment decisions in a way that both complies with existing regulations (such as they are) and anticipates the future regulatory environment,” said Michael Diaz, Jr., Diaz Reus global managing partner.

And the FAA will not be the only entity involved. Rules governing privacy, insurance, defense of person and property, and products liability are going to have to be taken up by state legislatures and state courts. “Now is the time to start anticipating what those rules are likely to be,” said Diaz. “That’s why we established our practice. That’s where we can add value.”

About Diaz Reus

Diaz, Reus & Targ, LLP (Diaz Reus) is a full-service international law firm offering comprehensive legal services to U.S.-based and international clients around the world. The firm’s global reach extends from its Miami, Fla., headquarters to its international offices strategically located in dynamic markets throughout Latin America, the Middle East, and in Asia and Europe. For more information, visit www.diazreus.com.

Diaz Reus & Targ LLP scored a stunning victory in the U.S. District Court for the Southern District of New York last week on behalf of the government of Venezuela, obtaining complete and final dismissal with prejudice of a suit brought by Smith Rocke Ltd., a purported creditor in the Lehman Bros. bankruptcy.

Smith Rocke’s Allegation

The suit was predicated on Smith Rocke’s allegation that Venezuelan government agencies had expropriated the company’s entitlement to payments from the Lehman Bros. bankruptcy estate worth more than $400 million. In a comprehensive opinion handed down by U.S. District Court Judge Lorna Schofield, the Court soundly rejected all of the Plaintiff’s expropriation and conversion claims, and dismissed the suit with prejudice.

Case Background

Smith Rocke, a BVI company, is controlled by its Venezuelan shareholders who were previously associated with a Venezuelan bank, Banco Canarias, and another affiliated Venezuelan entity, Credican. Both Banco Canarias and Credican were placed into receivership several years ago by Venezuelan banking regulators. Shortly thereafter, Smith Rocke facilitated an unauthorized “assignment” of the right to receive payments from the defunct entities to Smith Rocke, in an effort to gain control of assets valued in the hundreds of millions of dollars. Regulators are seeking to recover these assets in order to satisfy depositors and creditors of the failed financial institution.

Outcome of This Case

Once the Venezuelan government learned of the diversion of assets by the Smith Rocke shareholders, they notified the Lehman bankruptcy trustee so that no payments from the Lehman estate would be made to them. That action resulted in the filing of this suit by Smith Rocke against our client. The problem for Smith Rocke, of course, is that these shareholders never had a legitimate legal claim to these assets, and now the court has told them so.

Shortly before arriving in Miami, Ormachea contacted Mr. Roca to arrange a meeting where he would offer to dispose of pending Bolivian charges against him and charge someone else, going as far as to characterize Mr. Roca’s prosecution for “illegal enrichment” as a politically motivated scheme hatched by the Bolivian President Evo Morales and Vice President Álvaro García Linera, for which there was no evidence of wrongdoing.

Ormachea has pled not guilty to two counts, Foreign Travel in Aid of Racketeering and Attempted Hobbs Act Extortion, for which he could face a maximum of 25 years in jail if found guilty. Meanwhile, new illicit-enrichment charges against Roca that parallel those Ormachea offered to have dismissed have been filed in Boliva on behalf of Aerosur employees.

This is continued proof of Roca’s innocence. His business was taken from him for political reasons, forcing Roca and his family to flee his homeland. We will continue fighting to clear his name and recover the losses from the Bolivian government’s illegal expropriation of Roca’s assets.

]]>http://www.michaeldiazjr.com/2013/09/bolivias-anti-corruption-colonel-mario-fabrizio-ormachea-arrested-in-miami-fbi-sting-trial-period-set-for-october/feed/0http://www.michaeldiazjr.com/2013/09/bolivias-anti-corruption-colonel-mario-fabrizio-ormachea-arrested-in-miami-fbi-sting-trial-period-set-for-october/Are You Too Busy To Be A Good Parent?http://feedproxy.google.com/~r/MichaelDiazJr/~3/YYMTclPc0lM/
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Foster’s lawyer cited her client’s concern that Usher preferred to leave the children with third-party caregivers, over her. Ultimately, Usher’s busy travel schedule was not enough to deprive him of custody. Accidents happen, even when children live with both parents. And when parents, like Usher, have demanding schedules, it is inevitable that third-party caregivers will have to watch the children. The only other option would be for Usher to take his children with him. This would likely have resulted in yet another motion—this time potentially accusing Usher of failing to provide his children with a stable home environment. So, what are busy parents to do?

Parents can set aside emotions and simply communicate.

When it comes to children, parents must set aside their emotions and simply communicate. Whether face-to-face or through trusted intermediaries, the custodial parent should let the other know about scheduled absences. Both parents should know where the children will be while the custodial parent is away. More importantly, both parents should be familiar with the caregivers that will be supervising the children while the custodial parent travels. If possible, the parents may wish to hold a meeting with caregivers to establish a level of comfort and share expectations.

If it is in the best interests of the children, the custodial parent may consider allowing the other parent to supervise the children while he or she is away. This is easier when both parents live in the same city so that the children’s daily routine is not disturbed. If this is not possible, then any visitation schedules that already exist with the non-custodial parent should be kept in place.

No parent wants to leave his or her children for prolonged periods of time. But, in today’s world, many parents are forced to travel for business on a regular basis, or commute over long distances as part of their daily routine. Fortunately, technology helps make those long absences more manageable. Parents are able to chat with their children over video at any hour of the day, from virtually any location. Email and text messaging have also made it easier than ever for parents to keep track of their children and stay involved in their daily activities. While this may not be a substitute for having dinner with your kids, it is a reasonable accommodation.

Parents who travel often—and who are involved in contentious divorce or child custody proceedings—may wish to prepare a detailed travel plan that sets out all of the considerations discussed here. That document, depending on the jurisdiction, can be filed with the court. The goal is to ensure that a busy parent does not lose custody of his or her children simply because they have to make a living.

On a hot summer day, a swarm of lawyers files into a courtroom at the Lawson E. Thomas Courthouse Center in downtown Miami. The judge looks up from the bench, a weary expression on his face. This is one of the most contentious cases on his docket, if not the courthouse. There is no love lost between the soon to be ex-spouses. The relationship between the lawyers is not much better. In fact, it is downright nasty. It has been that way from the beginning of the litigation several years ago.

As I look to my opponents, I wonder how many thousands of dollars the nearly half-dozen lawyers sitting next to me are charging for this latest court appearance. I try to rise above the fray and project a sense of Zen-like calm. Sometimes I succeed, other times I fail. But this is to be expected in high-stakes divorce litigation.

For several years now, my client has struggled to raise the family that her husband abandoned. For years, my client has had to beg her family and friends to lend her money. She has sold most of her jewelry and anything else that would help her collect a few more dollars for groceries and other basic necessities. Despite her best efforts to conceal the very difficult circumstances of her life, everyone knows the truth. And, they pity my client. Her situation is so desperate that some of her neighbors have taken to dropping off shopping bags full of groceries so that she can feed her children. Although I love fighting for the underdog, this is not the story of a poor family trying to survive. It is just the opposite.

My client married a very wealthy man—a millionaire several times over. His personal holdings include several companies, residential and commercial real estate, luxury automobiles, and various other “toys.” This man has used his wealth to hire a legion of lawyers—experts in divorce, commercial litigation, tax law, and appeals. He is the proverbial 800-pound gorilla in the courtroom. But, what my client lacks in resources, she more than makes up for in tenacity, fortitude, and a never-ending desire for justice.

From this case—and many others like it—I have learned a few basic rules:

1. High-stakes divorces are like tactical military operations. The element of surprise is key. You must move quickly and quietly. Rather than threaten divorce you must file for divorce. This is a race to the courthouse.

2. Litigate before you mediate. Most high-stakes divorces end in settlement. The parties do not want their personal lives aired out in public and they do not want to spend millions in attorney’s fees. But don’t forget that the fear of public scrutiny and expensive attorneys will incentivize the parties to seriously negotiate. Use this to your advantage.

3. Shock and awe is the key to success. The 800-pound gorilla’s biggest weakness is his sense of complete power and control. Take that away, and you will cripple him. Injunctions and other equitable measures will quickly help you level the playing field. And, it will move the parties closer to settlement.

4. Control the storyline. You need to have a compelling story, you need to sell that story to your audience, and you need to tell it often. If you do not control the storyline, you do not control the case.

5. Feel your client’s pain. Any lawyer who tells you that they do not take their client’s cases personally should not be allowed inside a courtroom. When I get up in court, I am my client. I feel her anguish, her stress, and her fear. I will pound on the table, I will raise my voice, and I will project my client’s emotions. You will not be an effective advocate if there is an emotional wall between you and your client.

Class actions are usually won or lost at the class certification phase, when the court determines whether the case can in fact proceed on a class basis. In part guided by legislation that has sought to reign in class action abuse, and in part out of a desire to protect their limited resources from the headache of administering class actions, courts have become more particular about what types of claims will be amenable to class relief. Florida’s Third District Court of Appeal has just entered a ruling that illustrates some of the difficulties with certifying class actions.

The case was brought against a Miami-Dade County cemetery which had a history of poor record-keeping. For example, the cemetery lost track of burial locations on its grounds, as well as other records such as burial rights. Beginning in the 1990s, the cemetery was investigated by the Florida State Comptroller and placed under a series of regulatory orders requiring it to clean up its act. The Final Order was entered in 2002.

The lawsuit was brought after the Final Order, but the allegations were based on essentially the same type of harm that had been addressed by the Comptroller’s investigation. Testimony showed that a number of people had difficulty locating the burial locations of their loved ones at the cemetery. In a couple of instances, graves had to be partially exhumed to identify remains. Some of the testimony recounted in the opinion makes for difficult reading.

The class plaintiffs obtained certification of a class defined as:

[a]ll persons with burial plots or family members at Graceland Memorial Park South who were buried before 1994, that are unable to readily locate family members due to inadequate recordkeeping and identifying markers.

It was agreed by the parties that a survey and study would need to be carried out to identify the class members. The entire undertaking would have cost approximately $6 million.

Identifying Class Members

The problem, the appellate court found, was that this procedure for identifying the class members would require the defendant to carry out the very relief sought in Count IV of the class complaint. In that count, the plaintiffs demanded:

a permanent mandatory injunction that requires Defendants to fund a court supervised program that provides for an Examiner, the establishment of a Blue Ribbon panel of experts to survey, test, monitor and study the cemetery and disturbed remains to ascertain the location of and disposition of the subject remains and to insure their proper identification and perpetual care.

In other words, in order to be able to identify the class members, the defendant would be forced to undergo one of the punishments sought by the plaintiffs before a judgment could be reached. Such an arrangement, the court concluded, was fundamentally contrary to due process.

Res Judicata

The court went on to find that the class should not have been certified because it raised claims that had been adjudicated in the administrative proceeding brought by the Comptroller. Those claims, the court found, were barred by the doctrine of res judicata – i.e., the thing has already been adjudicated.

Evidence is Individualized

Finally, the court found that the other claims could not proceed as a class action because the evidence would be too individualized, thus defeating the requirement that matters of proof be “common” to all class members. Claims that normally require proof of individual facts, such as whether a person actually relied on a statement, or whether a person suffered emotional harm, are generally not amenable to class relief.

The lesson:

Not every case involving multiple plaintiffs with the same or similar claims against a common defendant will be amenable to class relief.

I just returned from a trip to Belgium and France—this just a week or so before the latest spate of train derailments (in Spain first, followed by Switzerland). As lawyers, we are always looking for ways to help clients avoid undue risk and these two catastrophic accidents crystallized thoughts that I had during my trip.

On a relatively short train excursion from Bruges to Brussels, I was standing, sandwiched with lots of others, between cars, as there were absolutely no seats to be had. A couple of days later on the fast train from Brussels to Paris, I briefly considered what might occur were our beautifully appointed speeding bullet somehow to launch off the track.

Which got me thinking: Why no seat belts on trains?

The experts tell us that train travel is exceptionally safe. But so, today, is flying on a major airline anywhere in the U.S. or Europe. All planes not only have seat belts, they have signs telling you when you must buckle up and flight attendants to hound you if you don’t.

So what really is the difference between planes and trains? Not much– except that it seems we retain this romantic view of trains (born in an era that has long since past). It was then that the giant locomotives puttered along at a relative snails pace while the ever- present, jaw-dropping scenery gave us pause to consider how truly breathtaking and relaxing travel could be.

The truth is that the Europeans, at least, have historically only focused briefly on the no-seat-belts-on trains issue after train accidents have occurred.

No surprise, until now.

Now we have the video of the Spanish fast train careening around the tracks–reportedly at 195 Kilometers per hour—and the utter and complete devastation that follows. That highly disturbing video has been replayed countless times on the web and on 24 hour news stations globally.

What is to be done?

Let the market decide. Give consumers the choice. Equip half of all fast train cars (to start) with seat belts and leave half without. Charge consumers an extra Euro or two for use of a seat belt. I suspect, but don’t know, that visitors to Europe such as myself, who will never abandon trains as the preferred mode of travel there, will enthusiastically embrace use of a seat belt. Who knows, we might even persuade our European brethren to do the same.

Have you wondered what it would be like to receive deliveries by drone? In China, it’s already happening: A private bakery in Shanghai began using small, four-rotor drones to deliver cakes to its customers.

The cake delivery service has been at least temporarily halted pending a regulatory review. After all, using the airspace over a big city has implications for public safety and air traffic control, so it is reasonable to expect that the private use of drones will require some regulatory oversight. The use of drones in the private sector is likely to cause similar regulatory headaches in the U.S. You can bet, for example, that Dominoes Pizza won’t be delivering by drone until the U.S. Federal Aviation Administration – which licenses pilots, certifies aircraft, and regulates the use of airspace – has signed off on a set of rules and regulations governing the use of drones for such purposes.

But assuming that the FAA – and similar authorities in other countries – allow the use of drones to deliver services in urban areas, such as pizzas, dry cleaning or, in the case of this article, cakes, you can bet that lawyers, judges and insurers will be left to figure out the rest.

What happens, for example, if a drone falls out of the sky or drops its cargo, causing injury to people or property? Will the drone’s owner be found negligent even if he took reasonable measures to make sure that the drone was in reasonable operating condition? Or will the owner be held strictly liable – meaning regardless of whether he was negligent – in tort? Is the drone like an employee or agent, or is it something else?

And what if a rival knocks down a competitor’s drone? Would that constitute a tortious interference with a business relationship? Maybe yes, because there’s never a justification for knocking down someone’s drone. Maybe no, because a competitor is privileged to look out for his or her economic interests.

At the end of the day, the biggest hurdle to using drones like this won’t be regulatory, but rather whether the risks are deemed insurable by underwriters. It will be interesting to see whether underwriters regard the risks of drones as being at least no greater than the risks associated with having a fleet of low-wage delivery drivers.

But if they are deemed an insurable risk, then a drone might well deliver your pizzas, one day.

You might be aware that financial institutions are required to report deposits of $10,000 or more by filing what is called a “Currency Transaction Report,” or CTR. What you might not know is that it is that making multiple deposits of less than $10,000, in multiple accounts, in order to avoid the CTR reporting threshold, is illegal.

The practice is called “structuring,” and it is one of many red flags that can trigger a money laundering investigation. But even if law enforcement can’t prove that you’re laundering ill-gotten money, they might seize your money and bring a forfeiture action merely based on the alleged offense of structuring.

That is precisely what happened to small businessman Reza Ella, who made structured deposits which added up to hundreds of thousands of dollars. Mr. Ella has not been accused of a crime. Law enforcement even recognizes that his activity was consistent with his business. But because he ran afoul of the law against structuring, he stands to lose more than $840,000.00 in what is called a civil forfeiture action. You can read the story and view the complaint, here.

At Diaz Reus, anti-money laundering and civil asset forfeiture are regular parts of our practice. If you have a cash-intensive business, we can help you avoid the potential pitfalls of anti-money laundering regulations or, if necessary, represent your interests in a civil asset forfeiture proceeding.

The question seems simple enough. But it took an appeal to the Florida Supreme Court to find the answer – an answer that will have a significant impact on the rights of U.S. litigants in lawsuits that have some relationship to events occurring abroad.

After returning home, Shahla Rabie Cortez, the victim, sued Palace Resorts, Inc. and two related companies that have their principal place of business at the same Miami address. Despite the fact that they were based in Miami, the defendants (Palace Resorts, et al.) persuaded the trial court to dismiss the suit because, the defendants argued, Florida was an inconvenient location for the suit, and the suit should have been filed in Quintano Roo, Mexico.

On appeal, a divided Third District appellate court in Miami affirmed the trial court’s decision. The majority of the appellate court concluded that, because Ms. Rabie was not a Florida resident, her choice of Florida as the location for bringing suit was entitled to no deference, even though the defendants were in Miami.

Diaz Reus petitioned the Florida Supreme Court, which heard argument last year from Diaz Reus partners Carlos Gonzalez and Gary Davidson. In a sweeping opinion, the Supreme Court found that Ms. Rabie was entitled to move forward with her lawsuit in Miami.* This was a huge victory.

The Supreme Court’s ruling placed an emphasis on the high degree of deference owed to a U.S. plaintiff’s choice of forum, regardless of whether the plaintiff resides in Florida or another U.S. state. Only a very strong showing by the defendant can overcome this deference.

The Supreme Court went on to find that courts should always consider “public interest factors,” such as Florida’s interest in protecting others against wrongdoing by Florida residents. In this case, although the assault occurred while Ms. Rabie was on vacation in Mexico, the negligent acts and omissions that resulted in that attack were set in motion in Florida where the defendant companies are based, where they operate, where they collect funds, and where they market vacation packages like the one she purchased.

The public interest aspect of the decision will have a significant impact on how trial courts consider disputes of this nature in the future. The Florida Supreme Court’s decision here signals not only to our courts, but to the international community, that Florida respects the rights of all U.S. citizens to have equal access to our State’s courts.

Florida clearly has an interest in ensuring that its corporate citizens do everything possible to avoid brutal attacks like the one Ms. Rabie endured. The public’s interest is best served by allowing Rabie’s claims to be heard by a Florida court.